Let’s face it; businesses generate waste. From paper waste at corporate offices to food waste at restaurants, many factors impact the amount of waste a business generates each year. However, businesses that aren’t monitoring waste and optimizing their service levels could be paying nearly double what they need to. That’s throwing money in the trash! According to the U.S. EPA, about one million extra tons of solid waste is created nationally each week between Thanksgiving and New Year’s Day. This is just one example of how businesses that do not consistently right-size their service levels are at risk of paying for unanticipated extra pick-ups or charges associated with overflowing dumpsters. As a result, they may have welcomed in the New Year with excess and avoidable service fees.
If you find yourself constantly adjusting service levels, or frequently paying penalty fees for extra pick-ups and overflowing bins, the solution is to actively manage your waste portfolio. Here are five tips to uncover hefty savings for your organization through a comprehensive “right sizing” program:
- Ensure you have accurate, timely visibility into service levels. Compile the number of containers, container size, pick-up schedule and costs for each location.
- Identify a key business variable that closely correlates to waste generation. For example, if you are in hospitality, you may use nights booked, or if you are in food service, you may use number of meals served.
- Calculate volume per variable unit across your entire portfolio to develop an operational average.
- Identify outliers—sites that diverge significantly from the portfolio average—and investigate why. Are the outliers caused by a valid business purpose or a unique business case?
- Corrective action to resolve outliers and watch the savings roll in!
Recently, Ecova partnered with a client to facilitate a right-sizing effort in order to reduce waste costs. The initiative started with a review of existing utility waste bills to collect relevant data, and then several visual audits and further analysis was conducted to determine the appropriate baseline service level to support the business need. This effort identified savings opportunities of 50 percent at impacted sites. Adjusting the service levels for the client’s outlier sites resulted in an annual savings of 20 percent of total waste expenses across the total portfolio.
Because waste levels are not static, but fluctuate over time, active management is key to maintaining savings. If you are not actively managing your waste expenses, it is more likely than not that your service levels are not optimized and you, too, are throwing money away.